House committee passes ban on future BP leases

BP Plc's safety record would bar the company from getting new U.S. offshore oil and gas exploration leases for up to seven years under bill language passed on Wednesday by a U.S. House committee.

The Committee on Natural Resources voted to pass an amendment by Representative George Miller, a California Democrat, that would prevent BP and other companies from getting new leases from the Department of the Interior unless they pass safety and environmental requirements.

The amendment did not mention BP specifically, but it would not allow any company to get leases that had more than 10 fatalities at drilling and production facilities or refineries that resulted from violations of federal or state health and environment laws within the last seven years.

"The Miller amendment would prohibit BP or any other company with an egregious worker and environmental safety record from new offshore oil and gas drilling," Miller's office said in an email after the vote.

The measure was added to a sweeping bill that the committee expected to clear on Thursday morning, but which would have to pass both the full House and Senate before reaching President Barack Obama's desk.

BP pleaded guilty to criminal charges stemming from the 2005 blast at its refinery in Texas City, Texas, that killed 15 workers and injured 180.

The Justice Department is interviewing witnesses in its criminal and civil investigations into the April 20 explosion of the rig that damaged BP's well that is gushing oil into the Gulf of Mexico and harming multibillion dollar fishing and tourism industries across five states.

The department has asked BP and other companies to preserve documents related to the explosion and subsequent spill, the worst in U.S. history.

About 4 percent of BP's revenue is related to new deepwater developments in the Gulf of Mexico, according to the British energy services firm John Wood Group.

A BP spokesman said the company had no comment about the Miller amendment.

Representative Bart Stupak, who chairs a separate House subcommittee investigating the BP oil spill, said he supported giving the Interior Department the discretion to block BP from getting future leases because of the company's bad safety record.

He downplayed concerns raised by some that BP needs continued drilling access to U.S. waters so it can earn money from the oil it produces to pay for billions of dollars in Gulf Coast cleanup costs and liability claims in the years ahead.

"I'm not going to allow BP to drill more so they make more money so they can pay us, and as they do that then there's more environmental damage," Stupak told reporters while speaking at the Platts Energy Podium. "It's a pretty big corporation. I'm sure they can find some money."

Separately, the Natural Resources Committee approved an amendment to establish an independent national commission to study the events leading up to the oil spill disaster.

[Source: By Timothy Gardner and Tom Doggett, Reuters, Washington, 14Jul10]

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